Exposing the damaging impact of energy debt on children

ACE Research have been working with The Children’s Society to investigate the problem of energy debt for families. Our research found that almost a million children are living in families in energy debt in the UK, and too often energy companies are not following their legal obligations to help these families.

Our new report, ‘Show Some Warmth: Exposing the damaging impact of energy debt on children’ reveals that four in 10 UK families with dependent children who faced energy debts felt intimidated by their energy company. Nearly half (48%) of these families reported that they were not treated with respect or given the support they needed. The impacts of energy debt can be severe; children in families that have faced this type of debt are significantly more likely to become ill in winter. Four in ten children in these families said they had trouble sleeping because their bedroom was too cold, while over half of parents in debt on their energy bills suffer from stress, anxiety or depression.

Energy companies are legally required to make sure they assess how much families can realistically afford to repay. They are also required to make it easy for customers to raise concerns, but too often this is not happening. The report highlights how all companies have good and bad energy debt practices, but no energy company is taking all the steps they should to protect children from the damaging effects of debt. The report calls on the Government to change the law so energy companies treat families with children as vulnerable customers, and to invest in energy efficiency improvements for low-income families.

Energy companies need to negotiate affordable debt repayment plans, including lowering or suspending debt repayments over the winter, when children’s health is most at risk. They also need to review staff training procedures, targets and call scripts so a flexible approach is taken with families. Energy companies should also offer a free helpline that customers can call from a mobile phone to raise concerns.

The report coincides with the launch of The Children’s Society’s Show Some Warmth campaign, which is part of its ongoing Debt Trap campaign.

Update: In spring 2015 we have been liaising closely with Ofgem, who are keen to take on board these findings and ensure vulnerable families get the support they need. Among other ongoing changes, Ofgem have published an open letter regarding the Priority Services Register. Drawing on our research, this states “We propose to add ‘families with children under 5’ as a “core” group eligible for the provision of safety services provided by network companies and are seeking views on this proposal.” Comments can be submitted until 14 May 2015 to Bhavika Mithani: Bhavika.Mithani@ofgem.gov.uk.